Subprime credit rating mortgage help

JackTait

Hi all

i am looking to buy my first property, but my credit rating isn’t perfect. I defaulted on an account 4 years ago, so still have 2 years until it comes off my record. The rest of my credit history is pretty much perfect. I have a Experian score of 732 for some sort of benchmark. I have a reasonable deposit saved up and wanted to buy much sooner rather than later. 

I have been insta rejected from L and C and Habito on the basis I defaulted an account within the last 6 years. Do I have to use a poor credit rating specialist? Or any recommendations? 

Thanks in advance

[Deleted User]

1 x default from 4 years ago doesn't really scream subprime or that you need a specialist broker, depending on amount & status. If you were bankrupt 2 years ago then 100% you would.. but just 1 default should be manageable by most brokers. L&C/Habito just auto decline as it's not in their business model - actual adverse cases (Bankruptcy, CCJs, multiple defaults) are a lot more involved and time consuming.

Trussle will accept bad credit and are effectively the same as L&C/Habito (free / high volume) if you're looking along those lines.

Whether one of those brokers is right for you is a different matter - how big is the default and what's it for? And is it settled?
£50 on a mobile and you're not going to have many issues, settled or not (although some lenders will want it settled). £3k on a credit card and you'll have more issues and probably need a specialist/more experienced adverse broker.

There are adverse brokers on this board (that will charge a fee), but they are very knowledgeable so it could be money well spent. Trussle are good, but they're not really "invested" in you. A smaller broker will be. Whether that makes a difference or not is a matter of opinion.

ACG

If this had been February, I would have expected to get this through on the high street or at normal rates. I am surprised Habito and L&C have said no outright, but I suppose that probably sums up the type of customers they want. 

The mortgage world is very different at the minute and I would still expect there to be options at reasonable rates but I can imagine passing the credit score in the current climate might be a bit tricky unless you have a big deposit. 

You shouldnt need a specialist broker, just a decent one. 

JackTait

Thanks for the quick response. 

The default was a big account. Around £6k on a car PCP. It was settled sept 2018. 

[Deleted User]

I'd say a PCP at that value does make a difference - it's a committed payment you knew you had to make, not just an "oversight". Not judging you as I've got adverse, but it does make things likely trickier than if it was "just" a mobile/mail order/utilities in my experience (as a customer and Underwriter!).

ACG makes a good point, passing a credit score might have got harder recently. Positives are that it's been settled well over a year (some lenders require that). Presumably you didn't get any CCJs because of it?

Still think it's possible to get through at somewhere like Trussle, but I'd consider someone that knows adverse well (e.g. ACG is one of the well known adverse brokers on here). For a mobile default, I'd probably take my chances for a freebie - but more significant you'll have to weigh up the pros/cons a bit more. Good luck with it all, I know it can be stressful and lots of questions etc once you apply!